Conversational Commerce Drives 80% of Companies to Invest in Generation AI for Growth: Meta Report

With AI-powered generative conversational messaging for businesses likely to attract 450 million consumers to e-commerce, nearly 80 percent of businesses plan to invest in the technology over the next few years, according to a joint study by social media giant Meta and researchers Major Bain & Company showed May 23.

This is due to the emergence of conversational commerce as the way most businesses large and small interact with at least half of their customers. The report, titled “Winning with Conversations,” surveyed approximately 7,800 end-users or consumers, 150 enterprises, and interviewed more than 25 senior executives across all industries. It found that almost 90 percent of inexperienced digital users preferred to connect with small businesses (SMBs) through conversational platforms to meet their daily needs.

About 60 percent surveyed large enterprises plan to increase spending on conversational travel in the next 3-4 years.

“As the use of business messaging on WhatsApp increases, we are investing in tools and solutions for businesses to ensure they have a strong presence, connect with the right audiences with tailored messages and deliver engaging threaded experiences that drive greater customer engagement and ROI . GenAI will play a key role in this vision and enable enterprises of all sizes, especially small businesses in India, to realize its enormous potential,” said Sandhya Devanathan, Head and Vice President, Meta India.

She added that the coming decade will offer technology, particularly generative artificial intelligence, a unique opportunity to revolutionize the way businesses of all sizes operate. “We are strongly committed to adding more features to our platform that will bridge the gap between businesses and their customers, supporting growth and engagement,” she said.

Although only about 200 million of the 650 million Indians are active in online stores on social media, GenAI-powered conversational platforms have the potential to attract another 450 million consumers to e-commerce, according to Arpan Sheth, partner at Bain & Company.

“We are seeing increasing user preference to use conversational platforms for everyday tasks, as well as increased spending and investment by companies in generative AI to improve the end-to-end journey on these platforms. We expect businesses both small and large to experiment with conversational commerce to redefine customer engagement and gain a competitive advantage,” he said.

Not only larger enterprises, smaller companies are also exploring end-to-end transactions through conversational business platforms like WhatsApp for business.

The report shows that conversational commerce will grow in areas of frequent purchases such as grocery shopping, or frequent transactions such as paying utility bills, accessing bank statements and travel bookings.

In early February, Devanathan highlighted that about 60 percent of WhatsApp users contact businesses on the messaging app every week.

Conversational platforms will become crucial for small and medium-sized businesses when it comes to solving key problems such as discoverability, cataloguing, order management, payments and customer engagement.